Uganda Telecom To Pay Shs5B To MTN

The bad business deals of Uganda Telecom (UTL) continue to haunt it, the latest being the September 12, 2017 Supreme Court’s upholding of the earlier ruling that UTL pays its rival MTN Uganda Shs5 billion as ruled by the Commercial Division of the High Court in 2011.

MTN Uganda sued UTL in the Commercial Court in 2009 under High Court Civil Suit No.297 of 2009 to recover over 3.4billion as local interconnect fees debt for the period March to December 2007.

However, UTL put in a defense saying that the traffic in contention was international traffic to Gemtel South Sudan through code +256-477xxx which the government of Uganda through Ministry of Works and Transport had authorized Gemtel to use.

That much as the code +256-477xxx was owned to by UTL locally the traffic it carried was international traffic to Gemtel and not local interconnect traffic.

But the High Court in 2011 ruled in favour of MTN awarding over Shs5 billion including interest, damages and costs. UTL’s loss stemmed from the fact that code +256-477xxx was the locally assigned numbering property of UTL for use as a local operator in the northern region districts and could not be used by Gemtel in South Sudan which had its own country code +249xxx. Therefore court ruled that the traffic carried on code +256-477xx was local interconnect traffic and not international traffic as claimed by UTL.

UTL was not done as it ran to the Court of Appeal which dismissed the Appeal on October 28, 2014 with costs and maintained the High Court decision. UTL further appealed to the Supreme Court in 2015.

Having listened to all sides over time, Justice Stella Arach Amoko saw no reason to overturn the decisions of the High Court and the Court of Appeal. “I decline to overturn the finding by the two Courts. I find no merit in the appeal and dismiss it with costs to the Respondent (MTN Uganda Limited),” Justice Arach said.

The ruling means Uganda telecom cannot appeal any further as the Supreme Court is the highest appellate Court in Uganda.

According to the ruling, the struggling uganda Telecom now under receivership has to pay MTN Uganda over Shs5 billion in interest, damages and costs of the case in all the three courts where it has lost the case. Should UTL fail to pay MTN, the latter can execute the judgment against any of UTL’s assets to recover the amount in question.

Justice Arach’s ruling brings to an end the almost 10-year litigation battle between UTL and MTN Uganda.

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